DRIVING EFFICIENCIES: 6 STEPS TO IMPROVING …

1 DRIVING efficiencies : 6 steps to improving ASSET PERFORMANCE IN MANUFACTURINGINTRODUCTIONThe manufacturing industry is under immense pressure. Globalisation and increased competition, coupled with a more demanding consumer base, force manufacturers to seek new ways to boost the bottom line. To improve ROI and respond to customer demands for faster supply at a lower cost, many companies are required to run their manufacturing plants 24 hours a day, 7 days a week. They are squeezing every last drop of availability and capacity from their this growing pressure on manufacturing assets, it is crucial for companies to reassess their long term asset management strategies to ensure that they can meet demand both in the short and long who stops being better, stops being good. Oliver Cromwell6So where do you start? What is the journey towards best practice and improved asset performance?This eBook reveals six key STEPS you can take to improve asset performance in your organisation.

2 step 1: Identify barriers step 2: Create a business case for analysisStep 3: Manage and track against KPIsStep 4: Collect key data step 5: Form an asset performance project teamStep 6: Identify success factors These key STEPS typically fall under the responsibility of the Reliability or Plant Engineer. Companies are increasingly recognising the importance of the Reliability Engineer, who is seen as the partner of both Maintenance and Production and helps guide the improvement teams on the BARRIERS Below are some of the common scenarios found in manufacturing organisations that are struggling to improve asset 1 Reactive maintenanceReactive maintenance is characterised by poor equipment performance, unpredicted breakdowns and ongoing minor plant stoppages. The poor condition of the equipment results in quality defects and stoppages, which in turn leads to unexpected production losses and overspend of the maintenance budget. Together, these can cause deficits that run into 2 No proactive maintenanceWhen very little or no proactive maintenance exists, a fire fighting maintenance regime results, whereby temporary repairs or band-aid solutions are regularly applied to keep the equipment 3 Disorganised workshops and storesThe condition of maintenance workshops and stores can pose a real barrier to efficient maintenance practices.

3 Too often, these facilities are untidy and disorganised, which leads to multiple uncontrolled satellite stores located around the plant. Ensuring the right spares are readily available and in fit condition becomes nearly impossible under these BARRIERSB efore you implement strategies to improve the short and long term performance of your most critical assets, you need to identify potential barriers to success. BARRIER 4 Limited planning and schedulingWhen planning and scheduling is reactive, it is often the planned activities that get dropped from the daily work schedule. Proactive strategies seem to be of little value to an organisation struggling to meet the pressure to keep the plant running. It is hard to move into asset management mode and accurate equipment history is often not 5 Maintenance vs production mentalityWhen maintenance and production teams aren t working together or, worse, are in conflict then any impetus for positive change soon dries up.

4 Maintenance personnel are blamed for failures, morale is low and staff are too busy fixing things to conduct any inspections or preventative maintenance. BARRIER 6 Lack of leadership and management supportTo improve asset performance, you need the strong support of leadership and management teams in order to stop the fire fighting and target long term sustainable asset management. The journey must start at the top of the organisation. IDENTIFY BARRIERSCREATE A BUSINESS CASE FOR ANALYSIS2 This is one of the most common phrases cited by maintenance and reliability professionals. The adage holds true when it comes to asset performance. If you don t know your current performance measures or you don t know if they are good or bad then you have no way of knowing how or what to improve. Industry benchmarking is a useful method for assessing your company s performance. This basically compares your company to your competitors, or those with similar performance measures.

5 Benchmarking is a great starting point on the road to asset improvement, as it helps you identify best practices and the gap gives you something to work towards. EXERCISE: Calculate your maintenance budget savingsEstimate what percentage of maintenance work is performed in a reactive manner. That is, the condition of equipment has unexpectedly deteriorated and needs work to restore it to a fit condition for continued that percentage to the total maintenance spend to calculate the annual spend on reactive maintenance. Now multiply this by two thirds to find out how much of the maintenance budget can be saved or spent on improvement A BUSINESS CASE FOR ANALYSIS If we don t measure it, how can we improve it? A key measurement for any manufacturing facility is Asset Utilisation . This compares the theoretical maximum annual production rate against the rate at which you are actually operating, and delivers a measurement of loss against plant design capacity.

6 CREATE A BUSINESS CASE FOR ANALYSISCREATE A BUSINESS CASE FOR ANALYSISC reating your plan for asset improvement will require some form of benchmarking, loss accounting and a sound business case. Until you know your current performance, what is possible and its impact on the business, you cannot move onto the next step of the figure below shows the relationship between loss accounting and valuable operating time for a manufacturing operation. A good record of each loss event allows the analyst to adopt appropriate improvement methodologies to find ways to maximise plant ProductionValuable Operating TimeDowntimeLossesQualityLossesRate LossesDemand LossesMANAGE & TRACK AGAINST KPIS3 CREATE A BUSINESS CASE FOR ANALYSISIf your organisation is not in a position to formally measure KPIs, you should still be able to measure the number of unplanned outages, durations and costs. This provides an early indication of where to focus the improvement KPIsIndicatorFormulaPlant effectivenessAsset UtilisationAvailability x Performance rate x Quality rate x DemandOverall equipment effectivenessAvailability x Performance rate x Quality rateAvailability (%)Loading time Down time Loading timePerformance rate (%) Actual outputStandard speed x Running timeQuality Rate (%) Acceptable productsTotal outputDemand Rate (%) Market demandOperating timeTo manage and track the improvement in asset performance, you will need to identify and monitor a number of Key Performance Indicators (KPIs).

7 MANAGE & TRACK AGAINST KPIS x 100 x 100 x 100 x 100 MANAGE & TRACK AGAINST KPISR eliability and maintainabilityFailure frequency Total number of stops due to failureLoading timeBreakdown maintenance rate Number of breakdown maintenance jobs Total number of maintenance jobsNumber of minor stoppagesTotal number of minor stoppages during monthMean time between failures (MTBF) Total operating time Number of stops due to failureMean time to repair (MTTR) Total maintenance down time Number of stoppagesMaintenance efficiencyWork order (WO) completion rate WOs completed in periodOutstanding WOs at start of period + WOs raisedPlanned Maintenance (PM) achievement rate PM tasks completedPM tasks plannedMaintenance man hours per production unit Total maintenance man hours spentTotal units of productionMaintenance costsOverall maintenance cost rate (%) Total maintenance costTotal turnoverUnit maintenance cost Total maintenance costProduction volumeSpares inventories to asset value Total value of maintenance sparesAsset replacement valueOvertime costTotal cost of maintenance overtime and call-outsSub-contractor costTotal cost of maintenance work contracted outMaintenance cost to asset value Total maintenance costsAsset replacement value x 100 COLLECT KEY DATA4 CREATE A BUSINESS CASE FOR ANALYSISMost organisations find that the collection of data centres on two fundamental resources log sheets and the work order history.

8 Operator log sheets or e-logsThe main source of production-related information is the production log sheet or e-log. Use this to collect data on: Daily production Downtime (type and duration) Problems experienced (functional failures) Rejected productIt is important from a reliability perspective that the categories of downtime are captured in enough detail so that the Reliability Engineer can make informed decisions in regards to asset the maintenance KPIs have been identified, plan and develop your key data collection mechanisms so you ve got something to measure your KPIs KEY DATACOLLECT KEY DATAWork order historyThe CMMS should contain a reasonable amount of failure and maintenance history. It is important to analyse this database regularly, and to set up a reporting mechanism to provide further information about: Repetitive failures Equipment and component life Mean time between failures(MTBF) The effectiveness of the currentpreventive maintenanceprogramme to prevent failures Equipment conditions duringinspections Dominant failure mechanisms Weibull analysisAll of the data you collect in this step will be put to good use by the asset improvement project team, who you will form in step 5.

9 = 1 Probability of failureAge = 2 Probability of failureAgeFORM AN ASSET PERFORMANCE PROJECT TEAM5 CREATE A BUSINESS CASE FOR ANALYSISA sset performance project teams are made up of production, maintenance, reliability, procurement and design personnel. Some members will be full time, some part time. Whatever the make-up of your team, ensure that the entire team adheres to the following: Strong leader Full understanding of roles and responsibilities Work to a detailed asset improvement plan (the journey) Measures for success Team mission statement Regular, clear communication with all site employeesAppoint a strong leader, bring in people from key areas within your organisation, and provide solid support for all team members. FORM AN ASSET PERFORMANCE PROJECT TEAMFORM AN ASSET PERFORMANCE PROJECT TEAMGood leadership is critical to the team s overall leader should be able to articulate the common sense of purpose, and unite all members of the team so that you are working towards this purpose.

10 The team should be seen as a force to be reckoned with, yet should remain approachable and open. All site employees should be aware of the team s existence and know how to contact them with any ongoing plant issues or SUCCESS FACTORS6 CREATE A BUSINESS CASE FOR ANALYSISMore specifically, there are three key success factors for any asset improvement program: Loss elimination Risk management Life cycle asset managementThese success factors are typically the responsibility of the Reliability Engineer. Loss eliminationThis involves tracking production losses and assets with high maintenance costs, and then finding ways to reduce those losses or high costs. Efforts should be focused on the largest and most critical opportunities. Once these have been identified, develop an action plan to eliminate or reduce the losses through root cause analysis, seek approval, and implement the solutions. Most importantly, track the implementation and report on its status goal in IMPROVING asset performance is simple.